You can't run a 120 billion dollar bond trading operation with like 4 people.
That amount of money is a huge amount of work to manage no matter what you are trading.
The simple explanation of how they do this is that they don't have anything close to 120 billion to manage.
It is really a sociological and network experiment of how long fraud can persist when the fraud is in the short term interest of all nodes of the network.
I suspect the reason Bernie Madoff was able to persist for so long is that many of the investors thought he was front running trades because of his position with Nasdaq. People tend to be fine with fraud if they are directly benefiting from the fraud and only risking their capital in the process.
Time is not a good measure of non-fraud. That is just a rationalization because any crypto investor has to basically keep the idea of a tether fraud out of their head at this point considering the risk to the ecosystem would be so catastrophic.
What does actually grow in time is the risk to the network.
> You can't run a 120 billion dollar bond trading operation with like 4 people.
They delegate much of those issues to multiple regulated third parties.
The much referenced NYAG settlement in this discussion never shows they were committing massive fraud. There were periods when reserves included assets like receivables or funds temporarily seized by authorities but there was no finding that USDT wasn’t fully backed. The link to that settlement is thrown around with the implication that “see they are fraudulent” for those who don’t read the details.
I used to think exactly like all the anti-Tether people and conspiracies but the fact is that there exists no evidence for massive fraud and much evidence it isn’t.
That amount of money is a huge amount of work to manage no matter what you are trading.
The simple explanation of how they do this is that they don't have anything close to 120 billion to manage.
It is really a sociological and network experiment of how long fraud can persist when the fraud is in the short term interest of all nodes of the network.
I suspect the reason Bernie Madoff was able to persist for so long is that many of the investors thought he was front running trades because of his position with Nasdaq. People tend to be fine with fraud if they are directly benefiting from the fraud and only risking their capital in the process.
Time is not a good measure of non-fraud. That is just a rationalization because any crypto investor has to basically keep the idea of a tether fraud out of their head at this point considering the risk to the ecosystem would be so catastrophic.
What does actually grow in time is the risk to the network.